A trade union leader has warned Network Rail that it faces strike action when it announces 2,000 job losses today as part of a plan to cut costs.

A trade union leader has warned Network Rail that it faces strike action when it announces 2,000 job losses today as part of a plan to cut costs.

Network Rail, which took over from Railtrack, plans to make the cuts to its 14,000-strong workforce over the next three years.

The not-for-profit company was also publishing an efficiency plan outlining savings and cuts in spending over the next decade.

The job cuts will plunge the firm into fresh controversy following a row last week over executive pay. Unions and passenger groups were angry when it was revealed that directors received bonus payments totalling &#xA3;1.8 million last year, even though trains were still running late.

The Northern regional officer of the Rail, Maritime and Transport Union, Stan Herschel, said: "Cutting jobs like this is an absolutely scandalous idea.

"It will have a serious knock-on effect in the North East and as a union we are prepared to defend our members' interests to the hilt, even if it means industrial action."

Bob Crow, the RMT's general secretary, has described the plan as "obscene." He added: "It is huge bonuses for the directors and P45s for the rest. We will resist any compulsory redundancies."

Network Rail chairman Ian McAllister said: "Over the next three years we plan to reduce the number of people employed by around 2,000.

"That will largely come out of administration staff, contracting staff and so on. It's our responsibility to run the railways efficiently."

On the bonuses he said: "The reality is that Network Rail paid no bonuses to our directors last year."

Directors were paid bonuses for the six months last year that Railtrack continued as a company, but when it became Network Rail they were paid normal salaries, he said.

"I am making it clear the money was not paid by Network Rail, but was paid by the administrator."